1. Field of the Invention
The present invention relates to auction methods, and particularly to a method of auctioning license plates that generates additional tax revenue for local and state governments, and which may be an online auction on a computer network. More particularly, the present method allows for an increase in revenue for both state and local governments through the levying of sales taxes on the sale or transfer of license plates, and through the establishment of property taxes on license plates based upon a market value set for a particular license plate. Further, the present invention relates to a method for the valuation of physical and material articles, namely license plates, through the usage of auctions, appraisal by local tax assessors or the like.
2. Description of the Related Art
A vehicle registration plate, commonly called a license plate, is a metal or plastic plate attached to a motor vehicle or trailer for official identification purposes. The registration identifier is a numeric or alphanumeric code that uniquely identifies the vehicle within the issuing region's database. In some countries, the identifier is unique within the entire country, while in others, it is unique within each state or province. Whether the identifier is associated with a vehicle or a person also varies by issuing agency. Depending on the jurisdiction of issue, the vehicle registration plate may be referred to as a license plate, number plate, or simply tag.
Most governments require a registration plate to be attached to both the front and rear of a vehicle, although certain jurisdictions or vehicle types, such as motorcycles, only require one plate, which is usually attached to the rear of the vehicle. National databases relate this number to other information describing the vehicle, such as the make, model, color, year of manufacture, engine size, type of fuel used and mileage recorded during the vehicles annual (or bi-annual) road worthiness test, Vehicle identification (Chassis) Number and the name and address of the vehicle's registered owner or keeper.
In some jurisdictions, these registration plates will be permanently assigned to that particular vehicle for its lifetime. Some countries permit the re-registration of the vehicle with “personal” (also known as “vanity” or “Cherished Mark”) plates. When the vehicle is destroyed or exported to a different country it will require re-registering in the country of import. China, for example, requires the re-registration of any vehicle that crosses its borders from another country, such as overland holiday tourist visits, regardless of the amount of time it is due to remain there, and this has to be arranged with prior approval.
In others, such as U.S. states, where the term “license plate” is most commonly used, they may require periodic changing. For cost-saving purposes, however, the tendency for the past three decades has been to simply replace a small decal on the plate's surface, or to use a decal on the windshield to indicate the current expiration date of the registration. Additionally, some jurisdictions follow a “plate-to-owner” policy, meaning that when a vehicle is sold, the seller removes the current plate(s) from the vehicle. Buyers must either obtain new plates from their jurisdiction of residence or attach plates that they already hold from that jurisdiction, as well as formally registering their vehicles, under the buyer's name and the plate number, with the appropriate authorities. A person who sells a car and then purchases a new one can apply to have the old plates put onto this car. One who sells a car and does not buy a new one may, depending on the local laws involved, have to turn the old plates in or destroy them, or may simply be permitted to keep them. Other states keep the plate with the vehicle when ownership passes.
In the United States and Canada, license plates are issued by each state or provincial government. The federal government issues plates only for its own vehicle fleet and for vehicles owned by foreign diplomats. The appearance of plates is frequently chosen to contain symbols, colors, or slogans associated with the issuing jurisdiction.
The numbering system of license plates varies among the jurisdictions. Some states issue a motorist a serial that stays with that person as long as they live in that state, while other states periodically issue new serials and completely rotate out any old ones. Several states do not regularly use certain letters (most commonly, the letters I, O, and/or Q) in their plates, except on vanity plates, so as not to confuse observers with the numbers one and zero. When a person moves from one state or province to another, they are normally required to obtain new license plates issued by the new place of residence. Some U.S. states will even require a person to obtain new plates if they accept employment in that state, unless they can show that they return to another state to live on a regular basis. The most prominent exceptions to this policy are active duty military service members, who legally do not change residence when they move to a new posting. Federal law specifically allows them to choose to either retain the state vehicle registration of their original residence or change registration to their state of assignment.
In some countries, people can pay extra and obtain “vanity plates”; i.e., license plates with a custom number or character set. In the U.S., Canada and Australia, vehicle owners may also pay extra for specialty plates. With these plates, the sequence of letters and numbers is chosen by the licensing agency, as with regular plates, but the owners select a plate design that is different from the normal license plate. Fees for specialty plates are usually channeled to a specific charity or organization. For example, California has issued the “Yosemite plate” and “whale tail plate,” both aimed at conservation efforts in the respective domains. Some jurisdictions allow for these special plates to also be vanity plates, usually for an additional fee on top of the cost of the plate.
When a vehicle is sold, the disposition of the license plates depends on state law and varies by state. In some states, license plates are transferred with the vehicle to its new owner. In other states, the license plates remain with the seller, who may, for a fee, transfer the license plates and any unused portion of the current registration to a new vehicle. Some states issue a new plate whenever the car is sold.
The various states have different schemes for reissuing license plates, a process known as “replating”. In some jurisdictions, plates are issued on a permanent basis and are not replaced unless the owner requests a new plate or that his or her existing plate be remade. These jurisdictions include California, Delaware, Massachusetts, Oklahoma, and Oregon. Other jurisdictions replate on a rolling basis, replacing a particular motorist's plate when it reaches a certain age. Jurisdictions employing a rolling replate program include Arkansas (plates reissued every eight years), Florida (six years), Idaho (seven years), Texas (seven years), and Washington (seven years due to the five-year warranty on the reflective coating). Pennsylvania recently repealed its legislation which required a replate every ten years, just in time to avoid the replate which would have been mandated by law for 2009.
Yet other jurisdictions may recall a particular series of plates for reissuance at regular or irregular intervals. This is particularly common in jurisdictions in which only one license plate series or design is valid at any given time. Optional-issue plates may or may not follow the same rules for replacement as standard-issue plates, depending on the jurisdiction.
Delaware permits two things that have created a secondary market in license plates. First, the state issues license plates with one-digit, two-digit, three-digit, and four-digit numbers. The Governor of Delaware has license plate number of “1”, the Lieutenant Governor has number “2”, and the Secretary of State has number “3”, but there are private owners who own some of the remaining single-digit tags. Second, owners are permitted to sell their licenses to other owners. Some of the low digit plates are made with white porcelain numbers, rather than the typical metal, thus making them more desirable in the marketplace.
Under Delaware law, passenger car plate numbers lower than 89000 can be made into a reproduction porcelain plate by the Delaware Historic Plate Company, which is the only firm that offers such reproductions. The law requires proof of registration of the number being reproduced. Commercial plates lower than C9999, dealer plates lower than D9999, and motorcycle plates lower than M/C9999 can also be reproduced.
The prestige of low-digit plates is such that three-digit plates can now bring $50,000 and two-digit plates can bring $200,000 in the market. Other jurisdictions also issue low-number license plates. For example, the District of Columbia reserves numbers 1 through 1250 for issuance at the discretion of the Mayor or City Council members.
It would be desirable to utilize the interest in the sale or transfer of desirable license plates in the open market to increase revenue for both the issuing state, and local jurisdictions. Thus, a method of auctioning license plates solving the aforementioned problems is desired.